Horatio Inc. has three divisions which are operated as profit centers. Actual op

Question

Horatio Inc. has three divisions which are operated as profit centers. Actual operating data for the divisions listed alphabetically are as follows.

(a)

Operating Data

Women’s Shoes

Men’s Shoes

Children’s Shoes

$341,280

$227,520

126,400

113,760

120,080

758,400

568,800

316,000

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(b)

HORATIO INC.
Women’s Shoe Division
Responsibility Report
For the Month Ended June 30, 2017

Difference

Budget

Actual

Favorable
Unfavorable
Neither Favorable
nor Unfavorable

Horatio Inc. has three divisions which are operated as profit centers. Actual operating data for the divisions listed alphabetically are as follows.

Explanation / Answer

1.

2.

Women’s Shoe Division
Responsibility Report

Operating data Women's Shoes Men's Shoes Children's Shoes Contribution margin $341280 568800-404480
= 164320 $227520 Controllable fixed costs 126400 164320-113760
= 50560 227520-120080
= 107440 Controllable margin 341280-126400
= 214880 113760 120080 Sales 758400 568800 227520+316000
= 543520 Variable costs 758400-341280
= 417120 404480 316000

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